Feb. 15 (Bloomberg) -- SandRidge Energy Inc. shareholders
should side with TPG-Axon Capital Management LP and other
activist investors and vote to replace five members of the
company’s board, Institutional Shareholder Services said.

“The apparent failures of stewardship on this board are
legion,” ISS, a unit of MSCI Inc., said in an e-mailed report
today. TPG and other critics “have advanced a credible
narrative that the company’s abrupt, piecemeal approach to
corporate strategy and concomitant lack of capital discipline
have increasingly limited the company’s financial flexibility,
and engendered a deep distrust in the market.”

Shareholders should vote out five of SandRidge’s seven
board members and remove Chief Executive Officer Tom Ward from
his post as chairman, the shareholder advisory group said. Ward
should stay as CEO since there is no replacement for him yet,
ISS said, calling it “the lesser of two unpalatable
alternatives.”

TPG, SandRidge’s third-largest shareholder, and Mount
Kellett Capital Management LP have called on the oil and natural
gas producer to bring in new directors and fire Ward after years
of “disastrous” performance.

“We strongly disagree with ISS’ recommendation,” Greg
Dewey, a spokesman for Oklahoma City-based SandRidge, wrote in
an e-mail. “We have a strong and experienced board that is
committed to delivering value to all stockholders.”

Neutral View

SandRidge rose 0.5 percent to $5.90 at the close in New
York. The shares have declined 7.1 percent this year.

Another advisory company, Egan-Jones Ratings Co., said in a
Feb. 13 report that shareholders should vote to keep the
existing board.

The ISS report provides a neutral view to the back-and-forth between SandRidge and its critics, Jason Wangler, an
analyst at Wunderlich Securities Inc. in San Francisco, said in
a phone interview.

Shareholders have until March 15 to vote on SandRidge’s
board members.